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Bailout, banking, capital purchase programme, dividends, emergency economic stabilisation act, hybrid securities, preferred stock, small business lending fund, trust preferred, TRUPS, TARP, troubled asset relief programme
Most of the banks receiving capital injections from the Troubled Asset Relief Programme (TARP) issued preferred stock to taxpayers. This paper presents the factors that affect publicly traded banks’ ability to pay the scheduled TARP preferred stock dividends. Smaller banks with weaker capital ratios and more problem loans are significantly more likely to suspend payments of their bailout dividends.
International Journal of Financial Services Management
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